Editorial

Welcome to the May edition of I3 UPDATE / ENTOVATION International News, a free electronic briefing giving insights into the evolving knowledge economy and its implications for executives, policy makers and professionals. This month's edition kicks off with some thoughts on Knowledge Utilities - how close to reality are they? Debra provides two related articles on programmes at the Banff Centre where she has been part of the faculty. Finally we offer some thoughts on Knowledge Outsourcing.

David J. Skyrme

Two recent developments prompted me to write this article. The first is the launch in the UK of BT's ADSL (Asynchronous Digital Subscriber Line) service (BT Openworld) which gives 'always on' Internet access to the home at speeds of 2Mbyte / sec download and 512 Kbps upload. The second is the introduction of WAP-enabled (Wireless Access Protocol) mobile phones. Together they start to show the possibilities of information on tap, anywhere and anytime.

First Some Reality Checks

The prospects of much higher bandwidths into homes and mobile devices has been with us for several years. Cable companies provide high bandwidth into domestic properties via coaxial cables and those fortunate enough to live in the right areas and have Internet aware cable companies have been able to use cable modems operating at speeds of 4Mbps. Over 90 per cent of the population in the US have cables pass their homes - the figure is generally much lower in Europe. However, DSL and its many variants makes such speeds (and higher e.g. 8 Mbs) possible using existing telephone lines, and is thus potentially more widely available.

Reality Check 1 - can it be delivered in practice and at what speed? I've registered for BT's service but have been told I cannot have it - yet. It expects to reach over 50 per cent of the population by next summer, but today a) my exchange does not have the necessary equipment and b) BT are struggling to train enough support engineers (us consumers you understand, unlike corporate IT whizz-kids, ask more demanding questions, such as "I don't think its working - please fix it". Also the further you are away from an exchange the slower the speeds become.

Reality Check 2 - even if you have a high speed connection, the chances are that many web pages will take some time to download. Ten times faster local access may only translate to 2-3 times faster in practice. Much depends on routing congestion, and server loading for specific pages.

In terms of mobile communications, much of Europe is now in the process of opening bandwidth for 3rd generation cellular services, which in the medium term also promises speeds much higher than the 9,600 bps data rate that is the norm - to over 1 Mbps.

Reality Check 3 - The licences are only now being awarded (Finland, Japan and the UK among the first); infrastructure has to be built and the first services will probably only start in 2002 operating at 384 kbps per channel. Also, although the service providers claim to cover over 95 per cent of the population - that is where they live and not where they travel - on almost any car or train journey you will go through 'holes' in coverage - right when you are at a crucial stage of discussion!

WAP is the protocol that allows you to deliver Internet pages to mobile devices. It is optimized for low bandwidth devices. Suppliers are talking it up heavily, indicating how information will be available to you as you move - information on hotels and garages in your present locality, news, travel (Swissair are testing automatic check-in via your WAP phone). Analysts predict that all mobile phones will be WAP enabled within 18 months and (obviously to please the suppliers who paid for the surveys) that revenues per phone will climb rapidly (it needs to, to give a return on the costs of licences and infrastructure building!).

Reality Check 4 - Service providers will need to optimize their web pages for WAP (some suggest that page sizes should be restricted to no more than 1,400 bytes). But do you really want to walk along the street trying to read your tiny screen in bright sunshine? Watch out for more pedestrian collisions. Text information is more likely to be through other devices (hand held organizers / PDAs, sub notebooks, while the recipient is sitting or standing still).

Nevertheless, despite these realities, one does get the feel that the notion of information on tap, when and where you want it, is not too far away, and available in some places to the pioneers now. It is thus an appropriate time to review the characteristics of an information or knowledge utility.

Utilities Compared

The notion of an information utility is not new. Yoshedi Masuda, writing in 1980 in Managing in the Information Society (translated into English and published by Basil Blackwell in 1990) defined it as:

"an information infrastructure consisting of public information and service facilities that combine computer and communications networks. from these facilities, anyone, anywhere, at any time will be able easily, quickly and inexpensively to get any information which one requires."

He then went on to describe examples of business utilities, government utilities and citizen utilities. In fact he envisaged something like the communities we see on the Internet today - some foresight back in 1980!

Nolan, Norton & Company wrote in 1986 that "there are parallels between the information utility and the more familiar public utilities". This prompted me to write a paper that year on Knowledge Utilities, particularly as convergence between computers and communications was in vogue and the respective vendors were working out what kind of alliances they needed to enter (that convergence took another 10 years or so is another story). Obvious similarities include:

widely available access; high availability

supply sites and networks

millions of consumers

'standard' outlets (at least regionally)

Not so obvious then, but more so now:

trading of surplus capacity (there are now electronic markets for electricity e.g. by Enron, and Band-X "the bandwidth exchange" for telecomms bandwidth)

download and store e.g. consuming electricity during cheap periods for use later (e.g. overnight charging of batteries, domestic storage heaters); offline reading of downloaded files; certain synchronization software on PCs which allows you to plug in and have your databases updated (e.g. Lotus Notes replication).

a few large producing sites (for economies of scale) at strategic locations: originally most web pages were served from one server; then came mirror sites, and now we have server farms in multiple locations; for example - many accesses to the most popular websites are actually serviced by Akamai who have 2,000 strategically placed servers around the world.

Differentiation - Proliferation vs. Standardization

I noted at the time how Charles Tulley of IBM (I can't trace the original work now) emphasized that a common thread in all traditional utilities (water, gas, electricity) was that the delivery system was straightforward and simple to use (even though its inner detail may be detailed and complex). You turn a tap, you plug into a socket etc. Today, you turn your computer or mobile on, but then what....

This is where the main difference become apparent. The delivered good in the information utility is not homogeneous and so the specific item of information that the user wants must be delivered (as opposed to what is already in the pipeline). There is also high variety in the types of devices and user applications. To some extent this has happened with traditional utilities as the variety of appliances expands.

Nevertheless, Tulley's fundamentals are worthy aims, and one which the supply side of the information and knowledge industry need to address. At the moment, information and knowledge is packaged in a variety of ways, each packager trying to create their own differentiation. In contrast, frustrated users call for more consistency and standardization of user interfaces. To some extent this has happened in the field of Windows and browsers, but try a 'search' and it seems that when you go beyond a single word, that most search engines have their unique syntax. This problem has been realized and a few limited standards are now emerging (such as the prefix "site:" ) to restrict searches (see Search engine standards http://searchenginewatch.com/standards/index.html).

However, standards also need to be developed in the description of information resources, and again, some bright minds are working on this. The growing use of XML in ecommerce requires agreement on standard tags to describe commonly used data fields if information is to be readily exchanged. The W3C consortium is working on a Resource Descriptor framework to develop standard ways for using XML to represent metadata i.e. information about the properties of web content. While we are certainly not advocating homogenous information, we at least suggesting that some homogeneity in describing information would be helpful to the end-users. But as we all know, the best thought out standards don't always win - it's what wins the minds and pockets of the marketplace (and in the XML arena Microsoft is active with Biztalk).

Utility

While the above efforts will help create a utility like infrastructure, at least for information, the ultimate measure of success of a knowledge utility is - not surprisingly - that it should have utility i.e. value to the user. Now mathematicians and engineers will describe utility as functions of accessibility, usability, quality of supply, uniqueness, freshness etc. all of which vary according to the specific user needs. A more general way of stating this is that the user should be able to access quickly (say within three key clicks) information that is fit for purpose e.g. immediately usable. This is where the traditional online industry add value. Suppliers select, aggregate and refine information, produce abstracts, give ratings perhaps on their knowledge of the suppliers reputation. But this takes human time and effort. The new 'kids on the block' use sophisticated search technology to find appropriate information. Examples include Autonomy with its neural processing or - my favourite search engine for finding specific items - Google - htttp://www.google.com based on web linkages. However, these still lack the other validating factors - the quality of source. Somewhere in the middle the two will meet. Northern Light with its search engine and editorial team are a good current example.

Real knowledge, however, comes from using information in context, and this is where the in-house portal, well structured and organized according to application and use, and with validation by users, come into its own. A good intranet will be well structured, have a well constructed information architecture - designed by library and information professionals, not IT data dictionary specialists (although librarians would do well to look at some of the data repository and automatic indexing tools that are now available). Knowledge Centres (see I3 UPDATE No. 16) and Communities of Practice (I3 UPDATE No. 15) can also play an important part by adding the necessary human connections.

Refining the Flow

The true knowledge utility will give users a fast path to the best available (relevant) expertise. Some of its will be information summaries (both in-house and on the wider web and online sources). Others will be pointers to experts (via expertise directories). At the moment, it appears that the world is not short of generating capacity (lively minds), pipelines or access points (although universal wireless access by sensible devices is a few years away). Some improvement is also needed in devices to access on the move (selecting search terms on PalmTM like devices, PDAs or slim line notebooks is a far better proposition than typing into a mobile phone keypad, but perhaps voice activated devices will be the real breakthrough). The main obstacle is lack of appropriate refining mechanisms to find the best sources of knowledge, to filter out the dross, and to format what is selected in the way that the user can make immediate use of it. As noted earlier the essence of a utility is "straightforward and simple to use" to which we would add "and useful". That is the fundamental challenge facing all knowledge providers (creators, aggregators and delivery channels) if the knowledge utility is to become a reality.

Debra M. Amidon

We all know that the Knowledge Economy is one of communication - both human and technical. What we may not have realized is the leadership role to be played by the media in shaping new ways of learning, interaction and innovation. The coming decades will be based on social capital, the value of partnering and strategic alliances, cross-boundary relationships that traverse disciplines, functions and technologies yes, the power of multi-media productions.

They came from all over Canada, representing a broad spectrum of media experts (e.g., Vision TV, Discovery Channel, Picture Plant Ltd., Eagle Vision, Le Reseau des Sports, Great North Productions, Teletoon Canada Inc., YTV Canada, Cine-Groupe, Canadian Television Fund, WTN, CBC Regional News and Current Affairs, and more. There were 37 in all Presidents, Directors, Producers, VPs, Managing Directors, and Partners representing the leadership of the broadcast industry. Interestingly enough, the dates of the program coincided with the mega-merger of AOL and Turner Productions allowing for considerable speculative debate.

As with other Banff Executive Programs, participants completed the Executive Capability Chart this time completely adapted for the Television Industry! The program is intended to prepare senior level television and production executives to further exploit their entrepreneurial and managerial skills, enabling them to meet the challenges of the evolving global marketplace. There were behavioral descriptions according to Strategic Thinking and Entrepreneurship, Market Positioning and Branding, Understanding and Connecting Industry Processes, Capitalizing upon Industry Change, Financial Communication and Risk Management, Large project Management and Maximizing Human Resources. Participants with supervisor feedback were able to define their learning objectives and draft a learning contract that was monitored with learning partners throughout the entire week-long program.

Benefits of Learning Together

It is one thing for an executive to participate in such a residence experience and return to the organization able to assume higher management responsibility. It is quite another thing for several colleagues to enter into an intensive learning environment during which they can compare and contrast insight, debrief on potential strategies and then return to the organization geared for implementation. But this program was rather unique in that it provided that collaborative learning environment for essentially the next generation of television leadership.

We all know that many industries especially in the services sector have no grounds for collaboration, nor a platform for cooperative research. This residence experience provided a bootstrapping for young managers who have found themselves in executive positions without the benefit of any managerial courses or formal management training. The industry, by its very nature, is creative, innovative and in the state of constant change. Customer 'intimacy' is a given and operating on insight, intuition and imagination is the hallmark of success.

In knowledge terms, these individuals and their respective organizations participants and faculty alike formed a 'Community of Knowledge Practice' for the industry itself. They realized they had more in common than was different. Knowledge is the attribute that provides the future differentiation of products and services, not the technology or even the delivery mechanisms. So novel is this approach that the program is sure to become a beachhead for international learning on the topic spanning most continents in future programs. Already they have evidence of interest from The Netherlands and Mexico with other countries to soon follow suit.

Daily Learning Journal

Because the Banff Programs are largely experimental, participants are encouraged to think about each activity and make connections back to their unique circumstances. A small book was provided as a tool to capture thoughts and comments on sessions, great ideas raised by participants, diagrams and mind-maps, comments on action items, poetry, reflections on self-dialogue and collecting feedback.

This technique is not in-and-of-itself novel. What was exceptional was that each page carried a quote or verse that might be considered inspirational or thought provoking. Many of them were related to knowledge, ideas, action, innovation, opportunity, success, enthusiasm, imagination, dreams, intangible desire and more all terms that provide a solid foundation for our future strategies. They include:

"Go out and buy yourself a five-cent pencil and a ten-cent notebook and begin to write down some million-dollar ideas." Bob Grinde

"A lot of successful people are risk-takers. Unless you are willing to do that, to have a go, to fail miserably, and have another go, success won't happen." Philip Adam

"First they ignore you, then they ridicule you, then they fight you, and then you win." Gandhi

"The talent of success is nothing more than doing what you can do well, and doing well whatever you can do." Henry Wadsworth Longfellow

"It is a simple task that makes things complex, but a complex task to make them simple." Meyer's Law

"Don't let anyone talk you out of pursuing what you know to be a great idea." Anonymous

Well, you get the idea. As we proceed on a journey, there are simple phrases that can help us make connections that enable ourselves and our organizations to make progress. For a copy of the book and more information on Banff Centre Executive Programs, e-mail bcfm@banffcentre.ab.ca.

Debra M. Amidon

The Knowledge Economy may be one more of inspiration and imagination than knowledge per se.

The Banff Centre for Management (Calgary, Canada) has always been well known for its Executive Leadership programs. For years and under the direction of ENTOVATION Colleague and Banff Vice President, Doug Macnamara (doug_Macnamara@banffcentre.ab.ca), the Centre has convened intensive residence leadership programs. From their ongoing research with 5,000 organizations across Canada and the US, they have identified three key areas and aligned modules to develop the necessary competencies in 1) People and Visionary Leadership 2) Internal Innovation, Knowledge and Process Leadership and 3) Political Influence and Relationship Building.

Module I: 'Guiding People and Organizational Change' includes a faculty of Fritjof Capra, Stephen Haines, Ron Heifetz, Mike Shaw, Lynne Swift, Linda Wilder and guest artists and faculty from the Banff Centre for the Arts. This 12-day program develops skills to assess the business environment and become leaders of individual and organizational change.

Module II: 'Creating and Implementing Innovation and Knowledge Management Systems' (March 19-24) addressed issues and techniques of interest to our constituency. Pre-work consisted of developing a learning contract and completing the Competency Profile that includes 4 levels of Behavior, in competence areas such as Direction Setting, Change Leadership, Critical Thinking, Organizational Development and Diversity, Personal and Organizational Balance, Quality, Knowledge Innovation as well as Community and Environmental Leadership. This matrix parallels the outline of 5th Generation Management - http://www.entovation.com/assessment/fifthgen.htm.

Module III addresses 'Working with the Government' more effectively and includes Politicians in Residence to address the changing roles and mandates of government.

Mary Betz, author of Planning for People in the Electronic Age and member of the Banff faculty, led a discussion on changing roles and skills for the knowledge age drawing upon the research findings of Creating the Knowledge-Based Business. Using the book Innovation Strategy for the Knowledge Economy participants assessed their organization capabilities with the advice and counsel of other participants. And some experiential discussions involved the Banff Faculty for the Arts characterizing theater production as one (challenging) form of innovation.

Hubert Saint-Onge, Executive-in-Residence and Vice President for Strategic Capabilities for Clarica (Waterloo, Canada), described the three-year Knowledge Capital Initiative in his company. The accompanying brochure includes an outline of the Business Rationale, The Vision, Blueprint and Implementation. Their knowledge strategy includes three key pillars: The technology Infrastructure, The Knowledge Architecture and the Leadership Culture.

Benefits enable Clarica to 1. Deepen Customer Relationships, 2. Maintain Strong Partnerships, 3. Build Effective Alliances, 4. Offer Support and Integrated Solutions, and 5. Work Smarter. Conditions for success include cross-functional collaboration, the evolution of a receptive culture, justification of scarce resources, measuring the use and performance of knowledge assets and setting appropriate scope of activities. For copies of the report, send an e-mail to hubert.saint-onge@clarica.com.

Participants attending this first knowledge residence program included representatives from the assembly of First Nations, AVAC Ltd, Alberta Hygienists Association, Canadian Diabetes Association, Ronald Peters Associates, Garth Homer Society, Region 3 Hospital Corporation and Saskatel. The Banff program includes 1, 3 and 6-month follow-up reviews. There is also The Banff Journal entitled Leadership Compass - General Leadership and Management Program Guide. The Winter/Spring Issue includes articles on "Managing to Have More Fun," "Creative Questioning - The Art of Asking Dumb Questions," "Trends in leadership," and "Leader - Know Thyself."

David J. Skyrme

On several occasions recently I have met former knowledge managers of large corporates. Both of their teams have been fully or partially outsourced. In one case, several members joined an established consultancy, while others formed a new knowledge management consultancies. In both cases, their former organizations have lost valuable KM experience as well as industry knowledge - or have they?

To some extent their loss has been mitigated by the very knowledge management practices they put in place. Knowledge management was, to a degree, institutionalized, so that their organizations knowledge management performance was reliant on networks of people rather than just a core team. Their former companies also gain by buying in their consultancy. They also gain because those involved gain wider experience by working in other industries. However, their former organizations do need to understand the pitfalls of outsourcing too much of their knowledge management efforts.

Several studies of IT outsourcing have shown how, without adequate attention to knowledge flows, that the companies become over dependent on their IT supplier. In a couple of highly publicized cases in the UK, some UK government departments while not totally satisfied with their supplier's performance (higher than anticipated costs, systems that were not delivered on time or had major failures - not all the suppliers fault, of course), have more or less found themselves locked in to their present supplier - the cost of change being too high.

A similar situation could occur in knowledge management. If you ask one of the big companies to deliver you a knowledge management solution "and don't bother us with the detail", you are potentially using some vital knowledge. yes, your supplier, in all probability will do a good job (after all KM is easier than implementing IT solutions, isn't it?!!), but how much of their knowledge of KM, and of their solution in YOUR organization have you gained? The answer, depends partly on how the contract is written but more importantly on the day-to-day working relationship. Do your own people work alongside those developing the solution? Are there systematic knowledge management processes for capturing lessons? Also who owns the resultant intellectual property rights. It is not unknown for large consultancies to want it both ways. If they work for you, they own the resultant generic solution to deliver to others. And, if you are a smaller specialist working for them - you guessed it, they want the resultant IPR (now watch them all write in to I3 UPDATE to say how the IPR rights are equitably distributed!).

The bottom line. With intellectual capital and knowledge being a key resource - much more valuable than the salaries of the people who hold it - do have clear guidelines on what you will and will not outsourced or contracted out?

Since yesterday, I have been reading your paper on "Blueprint for the Future" - http://www.gkii.org/articles/blueprint1.htm - and I certainly found it to be a very enlightening and fascinating document especially the sigmoid curve where innovation has a major role to play in creating future assets. I whole heartedly agree with whatever you had written in the paper and I do agree that organisations should compete but in a manner which leverages each other for mutual success. And you are also right about the fact that quite a few people are merely duplicating efforts when the potential for innovating is much higher...sadly it is very much true for India where the governance structure is highly repetitive, strictly goes by precedence and the learning process is really slow.

Yes, goddess Saraswati is proclaimed the goddess of knowledge and wisdom. You said a lot of things in saying "No need to re-invent but innovate". I think I will now start looking at things from this perspective.

Thank you so much for all your inspiration and networking support you are giving to me. I am sure all of us together can make a difference and will do so.

The first cohort of the Open University's MBA module in knowledge management (B883) have completed their course. One assignment on the course that each student has to do is to develop an assessment of the intellectual capital of their own organization. Getting that right should be worth an MBA in itself! The driver behind the KM module is Professor Paul Quintas, the UK's first professor of knowledge management (appointed some two years ago) who, having steered the course to completion, now has time to give his inaugural lecture! See http://www3.open.ac.uk/courses/bin/p12.dll?C01B823

We are now seeing the arrival of so-called '2nd generation' books and reports e.g.

Enabling Knowledge Creation: How to unlock the mystery of tacit knowledge and unleash the power of innovation, G. von Krogh, K. Ichijo, and I. Nonaka, Oxford University Press.

Beyond Knowledge Management: New Ways to Work and Learn, Brian Hackett, The Conference Board. A survey by PriceWaterhouse Coopers and discussion and cases from a working group of 12 companies. Details from The Conference Board.

Initial comment: Although 2nd generation, the basic themes are the same as first generation. Its just that more companies are taking them seriously (80 per cent have a KM initiative says the PwC survey), but there is still a long way to go (only 6 per cent use KM enterprise-wide). Still this book and report add further ideas, cases and guidelines for you to act on.

A hot profile dot.com (selling sportswear) Boo.com has just gone into receivership when its financial backers failed to come up with further funding. We noted problems at boo.com in I3 UPDATE No. 38. According to Gartner Group, boo.com won't be the last by a long way. They suggest that 90 or 95 per cent of dot.coms that have started or gone for an IPO in the last 2-3 years will not survive long-term. This week, a PriceWaterHouseCoopers study of 28 newly publicly quoted UK dot.coms indicate that at current spend rates, 25 will run out of cash within 15 months. It looks like the days when dot.coms can burn cash rather than generate it are fast disappearing. We'll help you sort out dot.com winners and losers in next month's edition.

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